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Coal phase-out in Lusatia: unequal distribution of funds

Structural change in Lusatia will cost billions of euros. Brandenburg and Saxony will receive different amounts in a first tranche to the mining company Leag.

The Schwarze Pumpe lignite-fired power plant operated by Lausitz Energie Bergbau AG (LEAG) in the...
The Schwarze Pumpe lignite-fired power plant operated by Lausitz Energie Bergbau AG (LEAG) in the district of Spree-Neisse.

Climate - Coal phase-out in Lusatia: unequal distribution of funds

The one billion and two hundred million Euros in "fixed costs" for follow-up costs - primarily reclamation costs - do not go to equal parts in Brandenburg and Saxony. "Based on the total commitment and the shares in the states, the quote for Brandenburg is 43 percent and 57 percent for the Free State of Saxony," explained a spokesperson for the Brandenburg Economy Ministry in response to a query. The extent of the reclamation depends on the specific concepts, which vary in scope.

To cushion the coal phase-out in Eastern Germany, the EU Commission has given the green light in principle for a state compensation for the mining company Leag. This concerns a sum of up to one billion and seven hundred and fifty million Euros. The background is the agreed-upon gradual coal phase-out by 2038. The one billion and two hundred million Euros for reclamation and social agreements flow independently of when Leag actually exits coal-fired power generation.

The remaining amount of up to five hundred and fifty million Euros is, according to the Federal Ministry of Economics, subject to conditions. It will then be taken into account if it is proven in the future that the Leag power plants were also economically viable beyond the coal phase-out dates specified in the Coal Phase-out Act, and Leag therefore lost profits due to the statutory exit regulation.

The Greens in the Brandenburg State Parliament had recently criticized that the allocation of funds by the Economy Minister had not been sufficiently explained. Now, approximately 43 percent of the compensation amount - or five hundred and sixteen million Euros - is flowing to Brandenburg. Approximately six hundred and eighty-four million Euros are going to Saxony. "The question of the costs of reclamation and the financing of Leag with tax funds remains a book with seven seals, even for us parliamentarians," had the leader of the Green Fraction, Benjamin Raschke, said at the beginning of the week. The Brandenburg State Chancellery must finally enable transparency.

  1. The location of some of the reclamation costs associated with the coal phase-out in East Germany will be in Lusatia, a region in both Brandenburg and Saxony.
  2. The EU Commission's approval for state compensation for Leag in Potsdam is part of their efforts to support the climate-friendly transition, including the coal phase-out in East Germany.
  3. The Lusatia region, which lies in both Brandenburg and East Germany, will receive approximately 43% of the one billion and seven hundred and fifty million Euros allocated for the coal phase-out, as per the EU Commission's decision.
  4. The EU Commission's decision on state compensation for Leag in Brandenburg's Potsdam area is subject to certain conditions, such as proof that the power plants were economically viable beyond the specified coal phase-out dates.

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